Here it is, the first year we will be conducting the $20 dollar challenge. Our goal, to pay off the house by 31 DEC 2010. Starting balance: $55,350

We will continue to pay on the house as we have planned (I plan on updating the mortgage amount monthly so you can follow). The $20 dollar challenge will provide the final payment (Amount to be determined). Here are the areas we will asses to add money to the account:

1. Coupons: Only coupons from items we already use.

2. Interest earned on the account: We will store the money in INGDirect.

3. Ebay: Sell stuff around the house.

4. Half.com: Books

5. Craigs list: Furniture

6. Collection sales: Lots of stuff.

7. Credit Card rewards: Self explanatory.

8. Change: Daily change added to the change bank.

9. INGDirect referrals: 43 referrals left, if you want to help ask me to send you a link.

10. Starting change bank: I have been saving change for 8 months now, we will start with this amount (About $350)

11. Starting Balance: $20

12. Yard sale: Wife says she will do this one... we'll see.

13. Insurance refund: We receive an annual refund from our life insurance.

14. Military Discounts: We often receive 10% discount, we will add this savings to the challenge.

Alright, here we go....

ING Direct
ING Direct has provided three sources of income:
3a. Interest earned.
3b. Sign up bonus.
3c. Debt card use.

3a. INTEREST EAREND: The first is interest earned. As with any interest bearing account ING Direct provides a competitive return for your stored money. When you decide to go with an on-line bank you will usually earn a better return as there is little to no overhead for the bank because they do not need to keep a brick and mortar branch open.
Initially I was searching for a place to store my emergency fund that offered a good rate of return. I found this in ING, what I also found as a bonus was a way to link my brick and mortar bank accounts. Through ING Direct you are able to link up to three external bank accounts that you can transfer money to and from (All for free).
I have been a member since 2004 and have found only one drawback though for some this drawback might be a blessing. The time it takes to transfer money from one bank to the other is approximately 2-3 days. For those of you that need money on the spot this will be an issue, to negate this issue I opted to store $500 dollars in my regular checking account which also is a secondary overdraft protection for my main checking account. For those of you that are compulsive buyers, this drawback might be a blessing as it will take a few days for you to receive your money which in most cases is enough time for you to decide if you really need the item.
BONUS: Watch for a future post of the use of credit cards and interest bearing savings accounts as a form of passive income.
WORK INVOLVED: Open account, link external accounts and deposit money.

COMMITMENT: 30 Days, Initial set up is $250 dollars for a $25 dollar bonus then a minimum of 1 dollar must be maintained in account to earn interest.

PROJECTED EARNINGS: Interest is compounded daily (You can see the money grow in the website) then deposited on a monthly basis. Currently 2.75% APY.


3b. SIGN UP BONUS: ING Direct offers a $10 dollar bonus for each new person/account (Up to 25) that you assist in setting up. Basically you send the offer to a friend or family member and they use the link that you send to set up the account. They must open the account with $250 dollars. Within 30 days they will receive $25 dollars (An immediate 10% profit on their initial $250 dollars, then currently 2.75% thereafter) and you will receive $10 dollars. If you can get 25 people to sign up, you will receive $250 dollars free (They count it as interest income on taxes).
WORK INVOLVED: Once your account is established, contact friends and family and see if they are interested, if they are, just send a link, they do the rest.

COMMITMENT: Maintain at least $1 in account to keep it active.

PROJECTED EARNINGS: $10 per sign up bonus up to a maximum of $250 dollars. Since I have been a member, at one time they reset the number of sign ups. This provided the opportunity for 25 new sign ups.

NOTE: You can also sign up for an electric orange which is a checking account (See 3c below). This account will allow the same sign up bonus as the savings account. If you can find 25 people to sign up for each of these accounts your potential profit is $500 dollars.

Also, if you would like a link for the free $25 dollars feel free to send me an e-mail or post to this thread and I will send you a link: mrpaseo@hotmail.com

3c. DEBT CARD USE: This requires the set up of an Electric Orange account. The Electric Orange account is a checking account that ING Direct offers. This account is interest bearing but provides less than the savings account (See website for details). ING Direct often has a $20 dollar bonus program that entails you using your debt card that is linked to this account five times within a month. This program does not happen every month so you need to pay attention to your e-mails and watch for it.

WORK INVOLVED: Establish an Electric Orange account; wait for program to be announced, transfer money on planned purchases (If you do unplanned purchases you will not be making any money because you will be spending any profits) to the account, use debt card for at least five purchases for a minimum of $10 per purchase within the month

COMMITMENT: Maintain at least $1 in account to keep it active

PROJECTED EARNINGS: $20 dollars per event (Currently I am tracking that they have done this event twice)

NOTE: We took advantage of this once (We did not see the first one until after the month was over). The bonus was received within the 30 days.

The largest one time "Free Money" that we have earned is $125 dollars. The requirement was to open two accounts with a minimum of $100 (one checking and one savings, both interest bearing), set up direct deposit to the account and maintain the account for six months.

Simple enough. As you can see, the initial cost is $200 dollars. This is where I came up with the $500 dollar goal in the free money account. My objective with this goal is to start with the $500 and see how much I can make it grow. How it will be spent will be determined later on in life, until then, I intend to just have fun.

We have a new credit card with this bank; this credit card has a zero % interest for 12 months. We decided to take a cash advance (At zero percent interest) of $2000 for each account. Effectively we started earning interest on $4000. That said, the opening amount was easily covered at a profit. The next step was the direct deposit, we use my wife’s income for these venues as we live entirely on my income, if there were any issues with her direct deposit we would not have any issues without budget. Another alternative would be to have a 3-6 month emergency fund set up to cover any issues with your direct deposit (That is if your family has only one income). Once her direct deposit was set up we connected this bank account to our ING Direct account so we would continue to have access to her income. Now we just wait for the six month time limit and we can move her direct deposit to another account for a similar mission.

WORK INVOLVED: Research bank account offers, save initial money for set up, set up direct deposit, attach new account to ING Direct so we can still access the money

COMMITMENT: 6 Months

PROJECTED EARNINGS: $125.00 received as soon as the first direct deposit hit.

The simplest way to earn free money comes in the form of interest earned from our savings account. Currently we have three banks with six accounts that earn interest. On the first of the money I transfer the balances into the free money account in ING.

During the past year I have been in Iraq, being over here has offered me a lot of time to think about finances. I decided to develop a "Free Money" account. My goal to produce passive income has been my fuel for the research, within this blog I will enter how we produced the money, how much and what we plan on doing with it.

Our current goal is to simply build $500 dollars in this account.